Sri Lanka will take ‘months to recover’ as govt ponders airline sale
Gary NoakesSri Lanka’s tourism industry will take months to recover from the country’s economic crisis, a consultancy has warned, while plans to sell off the country’s national airline have emerged.
Geopolitical and security intelligence service Dragonfly said the crisis in the country was “likely to be long-lasting”; Sri Lanka is suffering shortages of fuel and food, prompting widespread protests this year – eventually resulting last week in a mass cabinet walkout and resignation of the country’s prime minister Mahinda Rajapaksa.
Squandering of foreign exchange reserves means there is no cash to pay for fuel imports and other necessities, while a switch to organic farming has seen yields of basic foods like rice fall sharply, Dragonfly highlighted
The FCDO is now advising against all but essential travel to Sri Lanka, but does not advise against transiting through Colombo’s Bandaranaike International airport.
Asia specialists Experience Travel Group and Travel Gallery issued a joint briefing note on the situation this week, in which they said the country had taken steps to quell the unrest, adding they were hopeful the country could be in a position to welcome tours in the summer.
The country’s government, which has several members of the same Rajapaksa family in prominent positions, has so far failed to secure international bail-outs.
“The crisis is unlikely to ease any time soon and probably in the near term it will get worse,” said a Dragonfly spokesperson, adding the country’s tourism sector was being hit particularly hard.
“Restoring trust in the sector, which has been crippled and is needed to get the country back on track, will – because of the shooting [during protests] and the curfew – probably take several months.”
A new prime minister, Ranil Wickremesinghe, has been installed and on Tuesday proposed selling off SriLankan Airlines as part of efforts to stabilise finances. The carrier lost £105 million in the year ending March 2021, but made £1.37 million in the first quarter of 2022 – its first profit in this period since 2006.
SriLankan was previously 40% owned by Emirates, and was profitable until 2008 when deposed prime minister Mahinda Rajapaksa brought the carrier entirely under government control.
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